February 1

2/1 - In Friday’s annual cattle inventory report, the USDA said the total U.S. cow herd (beef & dairy) was 93.6M head on Jan 1, down 0.2% from a year ago. Beef cows, at 31.2M head, were down 0.6%. Heifers (breeders), held back for beef cow replacement, were up 0.1%. Cattle numbers have peaked and are transitioning from herd expansion to contraction. The key for 2021 will be the rate of heifer liquidation. Heifers numbers held up in 2020, however, high feed costs and lower returns could change that quickly in 2021. More heifers in the slaughter mix would initially add to beef production this year - but eventually it means lower beef supplies at some point in the future. Live cattle futures closed at $115.05/cwt on Friday vs. $121.75 a year ago. The spring cattle contract (April) is trading a $121.85/cwt vs. a Covid-decimated $90.38 average for April 2020.